FD Summary
| Principal Amount | ₹50,000 |
| Interest Rate | 7.0% p.a. |
| Tenure | 1 year |
| Compounding | Quarterly |
| Interest Earned | ₹3,593 |
| Maturity Amount | ₹53,593 |
Tax Note: The ₹3,593 interest earned is fully taxable at your income slab rate. In the 30% bracket, your after-tax interest is approximately ₹2,414.
Impact of Compounding Frequency
Same principal, same rate — different compounding gives different returns:
| Compounding | Principal | Interest Rate | Interest Earned | Maturity Amount |
|---|---|---|---|---|
| Monthly | ₹50,000 | 7.0% | ₹3,615 | ₹53,615 |
| Quarterly | ₹50,000 | 7.0% | ₹3,593 | ₹53,593 |
| Half-Yearly | ₹50,000 | 7.0% | ₹3,561 | ₹53,561 |
| Annually | ₹50,000 | 7.0% | ₹3,500 | ₹53,500 |
Returns at Different Interest Rates
How much does a 0.5% rate difference matter? More than you think:
| Interest Rate | Interest Earned | Maturity Amount |
|---|---|---|
| 6.5% | ₹3,330 | ₹53,330 |
| 7.0% | ₹3,593 | ₹53,593 |
| 7.25% | ₹3,725 | ₹53,725 |
| 7.5% | ₹3,857 | ₹53,857 |
| 8.0% | ₹4,122 | ₹54,122 |
Calculate Your FD Returns
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Use FD CalculatorFrequently Asked Questions
What is the maturity amount for ₹50,000 FD for 1 year?
At 7.0% interest with quarterly compounding, ₹50,000 FD matures to ₹53,593 in 1 year. You earn ₹3,593 as interest income.
Is FD interest taxable in India?
Yes. FD interest is added to your income and taxed at your slab rate. Banks deduct TDS at 10% if interest exceeds ₹40,000 per year (₹50,000 for senior citizens). You can submit Form 15G/15H to avoid TDS if your income is below taxable limit.
Which compounding frequency gives the best FD returns?
Monthly compounding gives the highest effective yield. For ₹50,000 at 7.0% for 1 year: monthly compounding gives ₹53,615, quarterly gives ₹53,593, and annual gives ₹53,500.
Should I break my FD if interest rates rise?
Breaking an FD early typically incurs a 0.5–1% penalty. Do the math: if new rates are 1%+ higher, breaking and reinvesting often makes sense for longer tenures. For FDs with less than 6 months remaining, it's usually not worth it.
FD vs SIP — which is better for this amount?
FD gives guaranteed returns of ₹53,593 in 1 year. SIP in equity mutual funds could potentially grow ₹50,000 lumpsum to ₹56,000 at 12% — but with market risk. FD suits short-term goals or emergency funds. SIP suits 5+ year wealth creation goals.